Posted in Money on February 20th, 2017
The following article covers a token or element in the cryptosphere. The cryptosphere is new and exciting, but changes rapidly and often in ways that do not benefit users. By the time this article is published, changes may have already occurred. Most tokens in the cryptosphere are complete scams that are get-rich-quick-schemes for insiders. Often, we cannot know this beforehand and only later discover this. A person should only trade with money that they’re willing to lose because losses are guaranteed. If you choose to participate in purchasing a token in the cryptosphere, you should do so with the full expectation of a loss and you should also expect it to change in a manner that does not benefit you. There are very few good ideas in the cryptosphere. Finally, by reading this post, you agree that you’ve read our disclosure
If you belong to any crypto-community, this may be one of the more difficult posts to read, as this will offend every echo chamber in existence. If there’s one thing I’ve learned about the cryptosphere it’s that people of all communities don’t like to read anything that is negative about their idea or community, even if they need to hear it.
With Dash making an all time high yesterday, I saw a pattern that I’ve seen multiple times in the cryptosphere – some individuals selling the positives and the negatives in a way that doesn’t look at reality, but evaluates things in a questionable manner, like “Person [X] secretly said [Y]” or “Community [X] is really just trying to steal money.” We can all have theories about why people do this and I expect more of it as the cryptosphere grows since people will want to undermine competitors, even if there’s reasons to like more than one or two ideas. While I like the underlying reason for things, like patterns in reality, these are not selling or buying points, simply what reality reflects and this can always quickly reverse. In other words, there is no guaranteed pattern, despite what you think or have read – there are assumptions which can all be wrong.
It’s naive to believe that it’s all cryptocurrencies versus fiat, because this is not true, nor will it be true. People do not have an infinite attention span and only a few cryptocurrencies will succeed in the long run, if any do at all. This is how reality works; dot com stocks were the same, energy startups were the same, etc. If the community succeeds at all, it will mean only a few big winners with the rest dissipating.
When we cover an idea, we aim to write about some of the positives, negatives and our concerns, but this is not always possible. One example on our site that differs from this was Zcash because it was an obvious supply shock at the time and we wrote almost entirely negative about it because it was very dangerous for people who were unaware of what was happening. As a humorous note, that article was one of our least popular posts, yet every word of it was true. In general, our cautionary posts are incredibly unpopular (Synereo, SteemIt, etc), yet have always turned out to be true. We’ve seen the same pattern with other posts, like the post what excites me about the boolberry project really taught us that few people actually read what we write.
There is absolutely no possible way that I can predict the future of any cryptocurrency or idea, in general. What sounds like a good idea, is built like a good idea, and executes like a good idea could really be a scam underneath. When I write in our warnings that you should only trade with money that you’re willing to lose, I mean it. If Bob buys one token, he should expect a full loss? If he can’t handle that, he shouldn’t be touching a token.
It is very possible that many of these ideas will turn out to be scams – including bitcoin. This is possible because changes can occur after the fact. Do you think people early in bitcoin thought it would innovate this slowly? From talking to many people, the answer is a clear “no.” This is one example of how people had an idea in the beginning, but over time, that idea either isn’t true, or evolved in a manner they didn’t expect.
Just like we have no control over a cryptocurrency, it is also possible that humanity goes extinct this year since that is also beyond our control. We cannot control reality no matter what we think and the cryptosphere, while fun sometimes, is a reality that we cannot control as much as we think. Something better could be created tomorrow that could make all of our ideas about money irrelevant – like a robot that could literally create anything we wanted for free (why would we need money?). To my knowledge, that doesn’t exist and no one is trying to build it, but it could exist tomorrow.
In the same manner, someone could create an idea with good intentions, be corrupted in time, then rip-off the same users he sold his idea to. We cannot control this; why anyone would do this is beyond us, but if you look at our site, you know we’re the kind of people who believe in building relationships founded on integrity, even if it generates less money in the short run (it’s the long run that matters to us). Based on what we’ve seen, this is the opposite of how this entire community thinks – including the cryptosphere media. From new ideas to articles covering those new ideas, everyone wants you to believe that this is the “new sex” even though the average cryptocurrency lasts less than 10 days before it collapses, making the average fiat currency look brilliant in comparison – and think how terrible fiat currencies are.
If you can’t find one problem with whatever you like then you are a fanboi plain and simple. You are not objective and you live in an echo chamber where you seek out people to validate your theories. I’ll be blunt: this applies to almost everyone in the cryptosphere and I have metrics from many posts to prove it; if the post is positive about your idea, you go nuts and share it; if the post has cautions or strong points of concern, you ignore it. This is your behavior, reflected in our numbers. We are the polar opposite of this; we constantly seek out people who disagree with us..
Case in point: we like Dash and think it’s a great cryptocurrency, but this doesn’t mean that we don’t have our concerns about it or that we never feature the opposite view about it (see the Tone Vays’ video in the post). In the same spirit, you can read another critique on Dash (some of the comments are also interesting) and some will come away thinking positive and negative things about Dash. There are many claims being thrown around in that post and in the comments, like we see with many negatives or positives of ideas, but how many of these pro and con arguments are true? We don’t know. I do find it fascinating that many people don’t use their name, as if that protects them.
Suppose a guy named Bob wanted to get involved and asked what I thought were the best ideas. After my time in the cryptosphere, I would simply ask Bob five questions:
Only an answer to every question of yes would mean Bob might do well in the community because his focus is right. Question three is one I’ve noticed more recently; some people are addicted to the cryptosphere in a dangerous manner. If you can’t stay away for a month, you have an addiction and I would severe ties. Life has more to offer than bitcoin and other cryptocurrencies; these are boring, life is fun and fascinating.
Most people do not belong in the cryptosphere. They’ll dislike us for writing it, but this is true because most people want to win rather than use the cryptosphere as a learning opportunity. In the latter example of approaching the cryptosphere as a learning opportunity, you can’t lose even if the entire community fails because you walked away learning about reality (even if money was lost). I’ve seen numerous posts where people were asking how they could drop 10% or more of their wealth into the cryptosphere hoping to get rich and this is the wrong attitude to have. Remember this guy?
If you feel even slightly emotional about a gain or a loss, I would advise getting out and staying out of the cryptosphere. I write the same about stocks, bonds and commodities. Emotional trading means that a person has an outcome addition; they may not realize it, but they’re setting themselves up for a disaster. Some people in the cryptosphere are addicted and don’t realize it – this doesn’t end well, even if it’s something as simple as missing out on how great life is.
I’ll end with one major lesson that I’ve learned with this entire community: what I criticized on Wall Street and at the Federal Reserve, I see very clearly in other places, including the cryptosphere. As it turns out, people can be corrupted anywhere and solving difficult problems with good intentions often creates bigger problems. This has reminded me that the greatest wealth in the world has always been and will always be behavior; stocks, currencies, bonds, commodities, and all that are great, but they come and go and the greed of many may end them all, like the Mongolian Empire spiraling out of control. In a sense, every investment into things that don’t change – like discipline, discernment, patience, etc – is the best investment. If you aren’t learning this lesson everyday, I would caution you that these are the lasting lessons to learn. Everything else will come and go; these remain forever and are money in every age.